The Changing Regulatory Mosaic of the Temporary Staffing Industry in Europe. Dr Jennifer Ferreira

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1 The Changing Regulatory Mosaic of the Temporary Staffing Industry in Europe Dr Jennifer Ferreira

2 Outline Temporary Agency Work in Europe National Varieties of Temporary Staffing Industry Temporary Agency Work Regulation Temporary Agency Workers Directive Summary

3 The Research project The institutional context of the temporary staffing industry: a European cross-national comparative approach Followed on from an ESRC funded project: The globalisation of the temporary staffing industry

4 The Temporary Staffing Industry In 2012 : global annual sales revenue for the temporary staffing industry reached billion million people worldwide were employed as temporary agency workers. 137,000 temporary staffing agencies across the globe. Temporary agency worker Employer Agency-Client Contract Temporary Staffing Agency

5 Temporary Agency Work Global Distribution

6 Temporary Agency Work: Europe Daily average number of temporary agency workers (FTE) Source: Ciett (2014)

7 Temporary Agency Work in Europe: Proportion of employees Source: OECD (2014)

8 National Varieties of the Temporary Staffing Industry THE MULTI-SCALAR STATE Regulation of the Temporary Staffing Industry Regulation of the mainstream employment relationship Welfare system and changing nature of job provision TRADE UNIONS Resistance and lobbying activities NATIONAL TEMPORARY STAFFING MARKET Client firms and workers segmented by geography, sector, firm size and occupation NATIONAL & INTERNATIONAL TRADE BODIES Lobbying for favourable regulation DOMESTIC AGENCIES Market expansion strategies (e.g. diversification, acquisition, organic growth) Competitive dynamics TRANSNATIONAL AGENCIES Market expansion strategies (e.g. diversification, acquisition, organic growth)

9 Temporary Staffing Industry in Germany European Regulatory Framework

10 Temporary Agency Work Restrictions License to operate Collective labour agreements Max length of assignment Quotas Option License for / derogation Authorisation Obligation to report Reasons for use Prohibition to replace striking workers Sectoral bans Equal pay Limitations for contract renewals

11 Regulation Framework Regulation of temporary agency work focuses on: Obligations for temporary staffing agencies Requirements of licenses to operate Provisions for equal treatment European Regulation: Temporary Agency Work National Regulation: Temporary Agency Work Global: ILO C181 European Regulation: Regular Employment National Regulation: Regular Employment Self-regulation

12 Global Influences C181: Private Employment Agencies Convention, 1997 Year Ratified Countries 1999 Spain, Netherlands, Finland 2000 Czech Republic, Italy A framework of guiding principles: how to improve regulation of TSI increase labour market flexibility foster development of temporary staffing agencies Instrument for setting minimum standards for the industry 2002 Portugal 2003 Hungary 2004 Belgium, Lithuania 2005 Bulgaria 2008 Poland 2010 Bosnia and Herzegovina

13 Typology Market driven Europe: UK Rapid AW development with open regulatory environment with limited restrictions. Liberal economies favouring flexibility over security. Social dialogue based Legislator driven Western Europe: Netherlands, Switzerland, Austria, Germany Nordic: Sweden, Denmark, Norway Western Europe/Mediterranean: France, Belgium, Luxembourg, Italy, Greece, Portugal, Spain Significant degrees of AW penetration in relatively material markets Moderately regulated, varying balances of flexibility and security Labour market policies organized and regulated by collective agreements Historically low AW penetration and low industry development Nordic social and economic system Penetration depending on level of industry development, ranging from above to below average Highly regulated, weighted towards job security over flexibility Historically labour market with high unemployment relative to social dialogue systems. Emerging markets Eastern Europe: Czech Republic, Lithuania, Slovenia Often temporary agency work legally recognised only recently Regulatory policies still in development Economic policies and market dynamics still evolving

14 Temporary Agency Workers Directive: Timeline January 1974: Issues of protecting temporary agency workers was first addressed in a Council Resolution. May 2001: Continued negotiations between European social partners. May 2008: TUC/CBI agreement that allowed agreement over a final version of the Directive. December 2009: EU AWD published in its second format January 1995: European Commission launches consultations on temporary agency work, fixed term work and part time work. May 2002: Agency Workers Directive first proposed. November 2008: EU Temporary Agency Workers Directive (2008/104/EC) agreed. December 2011: Final deadline whereby Member States needed to have implemented Directive.

15 Temporary Agency Workers Directive Two key sections with the potential to change regulatory landscape: Review of restrictions on TAW Equal Treatment Restrictions Prior to Directive Limited length of assignment Sectoral bans Limited reasons for use Limitations on Temporary Agency work contract renewals Waiting period Limitations on number of temporary agency workers Country Belgium, Czech Republic, Finland, France, Greece, Luxembourg, Poland, Portugal, Romania, Slovenia, Spain, Sweden. Belgium (public sector) France (public sector, doctors) Germany (construction) Luxembourg (public sector) Netherlands (shipping) Spain (Construction, public sector) France, Italy, Luxembourg, Romania, Sweden France, Italy, Luxembourg, Romania, Sweden France, Luxembourg, Hungary Austria, Italy, Sweden.

16 Temporary Agency Workers Directive: Implementation Duty to transpose Directive into national law by December 2011 All member states have transposed the Directive. Some countries were late with the last entering into force 1 July National law Collective agreement Combination of both Some did not have legal framework Some amended existing legislation Some considered national provision already compliant

17 Temporary Agency Workers Directive: Restrictions Article 4 states that prohibitions or restrictions on the use of temporary agency work are justified only on grounds of general interest relating to particular to: Protection of temporary agency workers The requirements of health and safety at work The need to ensure that the labour market functions properly The need to ensure that abuses are prevented Reasons for continued restrictions or prohibitions Protection of agency workers Requirements of health and safety Need to ensure the labour market functions properly Need to protect permanent employment Need to ensure abuses are prevented Right to strike

18 Temporary Agency Workers Directive: Equal Treatment Prior to Temporary Agency Workers Directive Countries with Equal treatment Countries with no equal treatment Countries with no specific regulation Austria, Belgium, Czech Republic, Denmark, Finland, France, German, Greece, Hungary, Italy Luxembourg, Netherlands, Poland, Portugal, Romania, Slovakia, Spain, Sweden Ireland, UK Bulgaria, Cyprus, Estonia, Lithuania, Latvia, Malta Article 5(1) lays down the principle of equal treatment - according to this principle, from the first day of their assignment, agency workers have to have the basic working and employment conditions that would apply if they were recruited directly by the user firm to occupy the same job

19 European Commission Review I am pleased to see that the Directive on temporary agency work has bought more decent working conditions for agency workers while providing businesses with flexibility they need for their development László Andor, European Commissioner for Employment, Social Affairs and Inclusion Commission Review: All Member States have adopted measures to implement Directive 2008/104/EC on temporary agency work and have in general done so correctly and applied its provisions in practice.

20 European Commission Review However, the Commission urges Member States to take further steps to ensure equal treatment for agency work. László Andor, European Commissioner for Employment, Social Affairs and Inclusion Further work needed: Where derogations have been used to prevention application of Directive Although some restrictive measures have been removed, in many cases Member states maintained the status quo.

21 Regulatory Efficiency Index Right of establishment Right to provide services and contracts Right to negotiate social protection Right to contribute to labour market policies

22 Employment Protection Legislation Indicators Employment Protection Legislation Indicator comprised of: Types of work for which temporary agency work is legal. Restrictions on the number of renewals of temporary agency work assignments Maximum cumulated duration of temporary agency work assignments Temporary staffing agencies authorisation required or reporting obligations Equal treatment of regular an agency works at the user firm

23 Summary The regulation of temporary agency work in Europe is complex and varies between different national environments Temporary Agency Workers Directive sought to harmonise the regulations on across Europe Regulatory variation in Europe remains. Next steps: to explore the impact of the Directive in more detail on agencies and workers.